Spirax Sarco increases its 2016 interim dividend by 8%

DividendMax Ltd.

Spirax Sarco increases its 2016 interim dividend by 8%

Organic sales growth of 5%

Adjusted operating profit up 18%

Adjusted operating margin increased 190 bps

Growth in both the Steam Specialties and Watson-Marlow businesses

90% cash conversion and interim dividend growth of 8%

Commenting on the results, Nicholas Anderson, Group Chief Executive, said:

"We are very pleased with the 5% organic sales growth and increase in adjusted operating profit of 18%, against flat global industrial production growth rates. Despite challenging conditions, we have seen organic sales growth in all divisions of the Steam Specialties business and Watson-Marlow is having another very strong year. 

In percentage growth terms, our first half results benefited from a relatively weak second quarter comparator and the carryover of some large orders from last year. As a result we would expect lower organic growth rates in the second half of the year. Reported growth will benefit from weaker sterling but will be less influenced by acquisitions. The slower growth rate, reduced profit contribution from Argentina, investment for future growth and the Hiter acquisition, should narrow the half on half margin expansion this year, resulting in a lower second half profit margin than in 2015.

We anticipate that our markets will remain challenging in the second half of this year. We are seeing the benefits of investments in our strategy for growth and have a robust, resilient and geographically diverse business model, which coupled with a strong balance sheet positions us well to navigate the current economic environment. The Board remains confident that the Group will make further progress in 2016."

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